However, the labels are getting worried because Pandora is attempting to negotiate for lower royalty fees. Currently, it pays 12 cents per 100 songs, but it needs to have a lower rate in order to generate a profit. Despite it not generating a profit, Pandora’s 12 cents per 100 songs fee is much lower than the 21 cents per 100 songs recommendation provided by the Copyright Royalty Board. Even Spotify, with its millions of users, is paying 35 cents per 100 songs.

The labels aren’t planning on lowering Pandora’s royalty fees however. They believe that the web radio industry is still growing, and that there will be other services that will be just as good as Pandora. They’re banking on Apple’s iRadio becoming a success. A source told The Verge that there is no doubt that Apple’s iRadio is coming, and that Apple has achieved a lot of progress with music labels. The sources say, “Apple is pushing really hard for a summertime launch”.